]]>As reported in The Nickel Report, on Thursday, the Senate confirmed Susan Parker Bodine as the Assistant Administrator of the Environmental Protection Agency’s Office of Enforcement and Compliance Assurance (“OECA”). OECA, the chief enforcement arm of EPA, coordinates the agency’s enforcement of numerous federal environmental laws within its authority.

]]>Legislators Request Action on Pipeline Infrastructure Attacks, and DOJ Respondshttps://www.pipelinelaw.com/2017/11/15/legislators-request-action-on-pipeline-infrastructure-attacks-and-doj-responds/
Wed, 15 Nov 2017 17:28:37 +0000https://www.pipelinelaw.com/?p=1836After a string of highly publicized attacks on energy pipelines in different areas of the country, several Congressmen addressed a letter to US Attorney General Jeff Sessions last month, asking that the United States Department of Justice (DOJ) respond to several questions concerning the ability and intent of the DOJ to investigate and prosecute criminal activity against energy infrastructure at the federal level. The letter also asks for DOJ clarification on whether attacks against the nation’s energy infrastructure fall within the DOJ’s understanding of 18 U.S.C. § 2331(5), which defines “domestic terrorism” to include activities that “involve acts dangerous to human life that are a violation of the criminal laws of the United States or of any State” and that “appear to be intended to . . . influence the policy of a government by intimidation or coercion.”… Continue Reading

]]>After a string of highly publicized attacks on energy pipelines in different areas of the country, several Congressmen addressed a letter to US Attorney General Jeff Sessions last month, asking that the United States Department of Justice (DOJ) respond to several questions concerning the ability and intent of the DOJ to investigate and prosecute criminal activity against energy infrastructure at the federal level. The letter also asks for DOJ clarification on whether attacks against the nation’s energy infrastructure fall within the DOJ’s understanding of 18 U.S.C. § 2331(5), which defines “domestic terrorism” to include activities that “involve acts dangerous to human life that are a violation of the criminal laws of the United States or of any State” and that “appear to be intended to . . . influence the policy of a government by intimidation or coercion.”

The letter, signed by more than eighty Congressional representatives, describes recent attempts by various activist groups to sabotage oil and gas pipeline transportation as “illegal and potentially fatal.” It directly references an October 11, 2016, incident where a coordinated group of environmental activists attempted to shut down five major cross-border oil pipelines by entering valve stations in remote locations in four states to unlock shut-off valves on each of the lines. This incident was one of a several attempts in the past year by activists to make a physical attack on pipeline operations as a means of environmental protest. Despite the increasing prevalence of such activities, the regulatory approach to pipeline security issues to date has been only through voluntary initiatives by facility owners and operators in accordance with Transportation Security Administration (TSA) security guidance and best practice recommendations. It remains to be seen whether recent events will build momentum for more oversight of pipeline security practices, as well as harsher punishments for saboteurs.

While DOJ has not issued a formal response to the legislators’ letter (which was issued on October 23, 2017), Reuters reports that last week, DOJ pledged to prosecute protesters who damage oil pipelines and other energy infrastructure, stating that it is committed to vigorously prosecuting anyone who damages “critical energy infrastructure in violation of federal law.”

]]>Recently Confirmed FERC and PHMSA Leaders Push Forward Pipeline Projects and Bring Renewed Focus to Pipeline Safetyhttps://www.pipelinelaw.com/2017/10/26/recently-confirmed-ferc-phmsa-leaders-push-forward-pipeline-projects-bring-renewed-focus-pipeline-safety/
Thu, 26 Oct 2017 16:52:59 +0000https://www.pipelinelaw.com/?p=1828Recent months have seen the appointment and confirmation of top posts in key pipeline regulatory agencies, the Federal Energy Regulatory Commission (FERC) and the Pipeline and Hazardous Materials Safety Administration (PHMSA). While developments are generally good news for the pipeline industry—in that they are likely to mean expeditious project approvals and a clear chain of command at the agencies—the past few weeks have seen interesting departures from past practices, as discussed in more detail below.… Continue Reading

]]>Recent months have seen the appointment and confirmation of top posts in key pipeline regulatory agencies, the Federal Energy Regulatory Commission (FERC) and the Pipeline and Hazardous Materials Safety Administration (PHMSA). While developments are generally good news for the pipeline industry—in that they are likely to mean expeditious project approvals and a clear chain of command at the agencies—the past few weeks have seen interesting departures from past practices, as discussed in more detail below.

FERC Regains a Quorum

After functioning without a quorum for months, FERC is now able to resume its approval of interstate natural gas pipelines and other energy infrastructure projects. The unanimous confirmations of Neil Chatterjee and Robert Powelson, both Republicans, have restored the quorum of the Commission. This was the first time that FERC has operated without a quorum in its 40-year history, which has caused a billion dollar backlog of regulatory approvals for market-ready projects. Among the priorities outlined by FERC Chairman Chatterjee are the improvement of the Commission’s project review processes and increased focus on the defense against “ever-changing cyber threats.”

Prior to joining FERC, Commissioner Chatterjee served as the energy policy advisor to U.S. Senate Majority Leader Mitch McConnell. Commissioner Powelson came to FERC from the Pennsylvania Public Utility Commission. Chatterjee and Powelson join sitting Commissioner Cheryl LaFleur, a Democrat nominated to FERC by former President Obama. President Trump has also nominated two lawyers to fill the remaining openings of the five-member bipartisan board of Commissioners: Kevin McIntyre, a Republican and energy lawyer, and Richard Glick, a Democrat who is serving as general counsel for the Senate Energy and Natural Resources Committee, both of whom are awaiting Senate confirmation.

Since regaining a quorum, the commissioners have been steadily working their way through the backlog of projects and proposals pending before the Commission. Notably, however, Commissioner LaFleur has dissented from the majority on several recent orders on natural gas pipeline projects, finding, for example, that certain pipeline projects are not in the public interest given their aggregate environmental impacts. It is unclear what the impact of these dissents will be in the future work of the Commission in reviewing and approval natural gas pipeline or other energy projects.

PHMSA Administrator Confirmed

PHMSA has a newly confirmed Administrator, 40-year railroad industry veteran Howard Elliott. Elliott recently retired from CSX Transportation as their Vice President of public safety, health and environment. As PHMSA Administrator, Elliott has stated that he is committed to encouraging “research and development efforts that will create and apply new and cutting-edge technology and automation to safety solutions.” At his confirmation hearing before the U.S. Senate Committee on Commerce, Science and Transportation, he stated that the promotion of and improvements to pipeline safety is absolutely critical, and advancements in technology will be prioritized. He signaled that that pending rulemakings from the Obama administration may be parsed to focus on those provisions that deliver the greatest safety measures. Elliott also plans to focus on first responders’ needs, improvements in communications and outreach with all PHMSA stakeholders, and the aggressive recruitment of candidates to fill PHMSA’s open positions. Drue Pearce, who was serving as acting administrator of PHMSA, will assume the title of Deputy Administrator of PHMSA.

]]>Federal Judge Declines to Shut Down Dakota Access Pipeline While Corps Corrects Errors in Environmental Reviewhttps://www.pipelinelaw.com/2017/10/16/federal-judge-declines-to-shut-down-dakota-access-pipeline-while-corps-corrects-errors-in-environmental-review/
Mon, 16 Oct 2017 15:07:03 +0000https://www.pipelinelaw.com/?p=1822Once large infrastructure projects, such as oil and natural gas pipelines, receive federal government approval, they are often the target of legal challenges from opposition groups. Opponents repeatedly argue that the environmental review, pursuant to the National Environmental Policy Act (NEPA), was insufficient. If a court finds deficiencies in the government’s NEPA analysis, can a court halt construction or cease operations even after years of project design, permit approvals at all levels of government, and tens of millions of dollars in investment? This question was at the heart of the ongoing litigation involving the controversial Dakota Access Pipeline (DAPL), and, on October 11, Judge James Boasberg determined “no,” the court would not shut down the pipeline. This case is important precedent for projects being challenged under NEPA. … Continue Reading

]]>Once large infrastructure projects, such as oil and natural gas pipelines, receive federal government approval, they are often the target of legal challenges from opposition groups. Opponents repeatedly argue that the environmental review, pursuant to the National Environmental Policy Act (NEPA), was insufficient. If a court finds deficiencies in the government’s NEPA analysis, can a court halt construction or cease operations even after years of project design, permit approvals at all levels of government, and tens of millions of dollars in investment? This question was at the heart of the ongoing litigation involving the controversial Dakota Access Pipeline (DAPL), and, on October 11, Judge James Boasberg determined “no,” the court would not shut down the pipeline. This case is important precedent for projects being challenged under NEPA. The same issue is at play in the Sabal Trail case currently under review by the US Court of Appeals for the DC Circuit. See Sierra Club, et al. v. FERC, No. 16-1329 (D.C. Cir. filed Sept. 21, 2016).

In the DAPL case, two tribes – the Standing Rock Sioux Tribe and the Cheyenne River Sioux Tribe – filed suit in July 2016 attempting to block construction and operation of a segment of the pipeline passing beneath Lake Oahe. Two weeks after the oil pipeline became fully operational, Judge James Boasberg of the US District Court for District of Columbia found three deficiencies in the US Army Corps of Engineers’ (Corps’) NEPA review. The court found the Corps failed to adequately address the degree to which the pipeline’s effects are likely to be highly controversial, the impacts of a potential spill on fish or wildlife, and the environmental justice impacts of a spill on Indian tribes. As noted in our earlier Nickel Report post, the court did not require pipeline operations to cease, and instead delayed the question of an appropriate remedy until after further briefing by the parties.

In his decision, Judge Boasberg relied on a two-part test provided by DC Circuit precedent to determine whether or not the court should vacate the Corps’ deficient action. See Allied-Signal v. U.S. Nuclear Regulatory Commission, 988 F.2d 146, 150–51 (D.C. Cir. 1993). Under the Allied-Signal test, the court evaluates:

The seriousness of the deficiencies in the agency action; and

The disruptive consequences of vacating the agency approval.

Judge Boasberg explained that, with regard to the first factor, in cases in which the agency’s reasoning is “so crippled as to be unlawful,” vacatur is generally appropriate. If the action, however, is “potentially lawful but insufficiently or inappropriately explained,” remand without vacatur may be imposed. Although the court found gaps in the Corps’ environmental analysis, Judge Boasberg stated “they are far from incurable.” The Corps need only better articulate its reasoning as to why expert reports did not present a substantial controversy; explain to a greater extent the consequences of a spill on Lake Oahe’s fish and wildlife; and provide a more robust analysis regarding impacts to minority communities to justify preparing an environmental assessment instead of a more extensive environmental impact statement. In light of the Corps’ substantial compliance, the court found that the Corps had a significant likelihood of being able to substantiate its prior conclusions and determined that the first part of the test weighed in favor of allowing operations to continue.

In assessing the disruptive consequences of vacatur, the court agreed that it was appropriate to consider financial harm, but made it clear the court will not necessarily give determinative effect to claims of economic injury. Judge Boasberg was also skeptical of DAPL’s predictions of economic devastation following a temporary shutdown. “Although courts have declined to vacate improper agency actions when doing so would be an ‘invitation to chaos,’ … in this case vacatur would be, at most, an invitation to substantial inconvenience.” The court found that, while stopping the flow of oil would have some disruptive effect, the second part of the test tipped “only narrowly” in favor of the defendants.

After weighing the equities in the Allied-Signal test, the court ultimately held that vacatur was not the appropriate remedy. But the court ordered the Corps to give “serious consideration to the errors” identified by the court. “Compliance with NEPA cannot be reduced to a bureaucratic formality, and the Court expects the Corps not to treat remand as an exercise in filling out the proper paperwork post hoc.”

]]>FERC: Water Quality Certification Waiver Period for Pipeline Projects Begins Upon Receipt of a Written Request for Certificationhttps://www.pipelinelaw.com/2017/09/18/ferc-water-quality-certification-waiver-period-pipeline-projects-begins-upon-receipt-written-request-certification/
Mon, 18 Sep 2017 18:10:25 +0000https://www.pipelinelaw.com/?p=1814On September 15, 2017, the Federal Energy Regulatory Commission (FERC or the Commission) issued an order in which it concluded that delays by the New York Department of Environmental Conservation (NYDEC or the Department) in processing Millennium Pipeline Company’s application for Clean Water Act (CWA) water quality certification constituted a waiver of the certification requirement. … Continue Reading

]]>On September 15, 2017, the Federal Energy Regulatory Commission (FERC or the Commission) issued an order in which it concluded that delays by the New York Department of Environmental Conservation (NYDEC or the Department) in processing Millennium Pipeline Company’s application for Clean Water Act (CWA) water quality certification constituted a waiver of the certification requirement. The order resolves a lengthy saga regarding water quality certification for Millennium’s Valley Lateral Project. It reaffirms previous FERC precedent establishing that the one-year waiver period for CWA water quality certification decisions by state agencies begins when the state agency receives a written application for certification, regardless of the state agency’s determination that the application is incomplete or requests for further information.

The central issue in the Millennium Pipeline controversy was when the statutory one-year waiver period (described here) for CWA water quality certification begins. Given the implications of the project’s timeline and dealings with NYDEC on this issue for future pipeline projects, a chronology of the key events leading up to the FERC order is included below. Millennium took the position that the one-year waiver period commenced on November 13, 2015 (when the company first submitted a written request for certification to NYDEC), whereas NYDEC asserted that the period commenced on August 31, 2016 (when Millennium provided the second of its responses to NYDEC’s requests for additional information in support of its application).

In its September 15 order, FERC sided with Millennium, stating that the Commission “interpret[s] the triggering date for the [CWA] waiver provision to be the date a certification application is filed with the relevant agency.” In support of its decision, FERC cited the plain language of the CWA Section 401, which specifies that water quality certification is waived when the certifying agency “fails or refuses to act on a request for certification within a reasonable period of time (which shall not exceed one year) after receipt of such request.” 33 U.S.C. § 1341(a)(1) (emphasis added). FERC further relied upon its own precedent and regulations concerning hydropower projects, as well as case law from the Ninth and D.C. Circuits, in reaching its conclusion.

While the Millennium Order reaffirms FERC’s position with respect to water quality certification waivers in the context of natural-gas pipeline projects, its precedential value is questionable in light of the fact that courts have rejected FERC’s interpretations of the CWA Section 401 certification provisions as authoritative, “given that FERC is not charged in any manner with administering the Clean Water Act.” AES Sparrows Point LNG, LLC v. Wilson, 589 F.3d 721, 730 (4th Cir. 2009); see also Alabama Rivers Alliance v. FERC, 325 F.3d 290, 297 (D.C. Cir. 2003). In its September 15 order, FERC acknowledges this precedent, noting that “[t]he Commission was not a party to [AES Sparrows] nor was the Commission’s interpretation of section 401 at issue.” The next step in the saga will therefore likely be a challenge to the order by NYDEC in the D.C. Circuit, and ultimately a decision that answers at least some of the lingering questions on the timing of the CWA Section 401 waiver provision.

The next step in the saga will therefore likely be a challenge to the Order by NYDEC. The Department would first have to apply for rehearing before FERC (within 30 days of September 15, the date the order was issued), but any application for rehearing would not stay the Commission’s order. Upon receiving an unfavorable decision on rehearing from FERC, the Department could then seek judicial review in the DC Circuit. A judicial decision may be helpful in resolving at least some of the lingering questions on the timing of the CWA Section 401 waiver provision.

Chronology of Events

November 13, 2015: Millennium applied to FERC for a Certificate of Public Convenience and Necessity requesting authorization to construct and operate the Valley Lateral Project.

November 23, 2015: NYDEC received Millennium’s formal written application for water quality certification.

December 7, 2015: NYDEC sent Millennium a Notice of Incomplete Application pending FERC’s issuance of the Environmental Assessment (EA) for the project as required under the National Environmental Policy Act (NEPA).

May 9, 2016: FERC issued an EA for the project.

June 17, 2016: NYDEC sent another Notice of Incomplete Application to Millennium requesting additional information on three protected species and minor clarifications in support of its application.

August 31, 2016: Millennium provided the second of its responses to NYDEC’s requests for additional information in support of its application.

November 9, 2016: FERC granted a Certificate of Public Convenience and Necessity to the project, conditioned upon Millennium filing documentation of receipt of all authorizations required under federal law or evidence of waiver thereof (including CWA Section 401 certification) prior to commencing construction.

June 23, 2017: The D.C. Circuit dismissed Millennium’s petition on jurisdictional grounds, explaining that the company’s remedy was to present evidence of waiver directly to FERC to seek authorization to begin construction of the project.

July 21, 2017: Millennium filed a Request for Notice to Proceed with Construction of the project with FERC, alleging that NYDEC had waived its certification authority by failing to act on Millennium’s application for certification within one year of its submittal on November 23, 2015.

July 26, 2017: NYDEC filed comments with FERC disagreeing that waiver had occurred, stating that the one-year waiver clock began running on August 31, 2016, the date that the Department received Millennium’s final response to the Department’s request for additional information.

August 30, 2017: NYDEC provided Notice denying Millennium’s application for certification and moved FERC to reopen the record and to stay the Commission’s November 9, 2016 Certificate order or, in the alternative, to grant rehearing and stay of the Certificate order.

September 15, 2017: FERC issued an order finding that NYDEC had waived its certification authority by not acting on Millennium’s application by November 23, 2016, one year from the date that the Department received Millennium’s formal written application.

]]>Second Circuit Upholds State Veto of Constitution Pipeline Project Via Denial of Water Quality Certificationhttps://www.pipelinelaw.com/2017/08/31/second-circuit-upholds-state-veto-constitution-pipeline-project-via-denial-water-quality-certification/
Thu, 31 Aug 2017 18:15:21 +0000https://www.pipelinelaw.com/?p=1791As previously reported on PipelineLaw, the ongoing controversy over an April 2016 decision by the New York Department of Environmental Conservation (NYDEC or the Department) to deny a Clean Water Act (CWA) water quality certification to Constitution Pipeline Company (Constitution or the Company) for its interstate natural gas pipeline project in Pennsylvania and New York highlights tensions between federal and state oversight of such projects.… Continue Reading

]]>As previously reported on PipelineLaw, the ongoing controversy over an April 2016 decision by the New York Department of Environmental Conservation (NYDEC or the Department) to deny a Clean Water Act (CWA) water quality certification to Constitution Pipeline Company (Constitution or the Company) for its interstate natural gas pipeline project in Pennsylvania and New York highlights tensions between federal and state oversight of such projects. In the latest chapter of this controversy, the Second Circuit recently denied Constitution’s petition for review of the NYDEC decision, concluding that (1) the Court lacked jurisdiction over the Company’s claims to the extent that they challenged the timeliness of the decision; and (2) the Department acted within its statutory authority in denying the certification, and its denial was not arbitrary or capricious.

The background of the Second Circuit case is detailed in the Court’s decision and explained in our previous post. The case is significant because it affirms a state agency’s use of its water quality certification authority to effectively veto an interstate pipeline project that has “secured approval from a host of other federal and state agencies” and is otherwise subject to federal oversight and permitting. See Constitution Pipeline Company LLC v. NYDEC et al., Case No. 16-1568 (2nd Cir. Aug. 18, 2017) (Constitution), at 23 (citing CWA legislative history that “Congress intended that the states would retain the power to block, for environmental reasons, local water projects that might otherwise win federal approval”). In the Court’s opinion, however, it also clarified the following points of interest to natural gas pipeline project proponents:

Jurisdiction Over CWA Waiver Arguments. CWA Section 401 requires an applicant for a federal permit (in Constitution’s case, a CWA Section 404 dredge and fill permit) to conduct activities that may result in discharges to jurisdictional waters to obtain certification from the relevant state agency that the discharges will comply with the State’s water quality standards. 33 U.S.C. § 1341(a)(1). If the state agency fails or refuses to act on a request for certification “within a reasonable period of time (which shall not exceed one year) after receipt of the request,” the certification requirement is waived. Id.In determining whether NYDEC’s many delays in deciding on Constitution’s request for certification amounted to a waiver of the certification requirement, the Court first looked to the text of the Natural Gas Act (NGA) to discern whether it had jurisdiction over the claim. The NGA provides, in relevant part, that the federal Court of Appeals for the circuit in which a natural gas pipeline facility is proposed to be constructed has jurisdiction over any state agency decision to “deny. . . any . . . approval” required under federal law for the project. 15 U.S.C. § 717r(d)(1). On the other hand, the NGA provides for “original and exclusive” jurisdiction in the D.C. Circuit Court of Appeals for the review of an alleged “failure to act” by a state agency in proceedings related to permits required under federal law. 15 U.S.C. § 717r(d)(2). Despite the ambiguity in these provisions, the Court held that Constitution’s waiver argument amounted to a “failure-to-act claim” over which only the D.C. Circuit had jurisdiction in accordance with NGA § 717r(d)(2).This holding stands in contrast to the D.C. Circuit’s recent decision in a similar case brought under NGA § 717r(d)(2) to challenge NYDEC’s delay in issuing a water quality certification for the construction of the Millenium pipeline project. In that case, the Court ruled that even if the Department’s lengthy delays in processing the project’s certification request did constitute a waiver under the CWA, there was no cognizable injury to Millenium that would give it standing to challenge the delays in court. Rather, according to the D.C. Circuit, the Company could seek to remedy any injury from the delay by presenting evidence of waiver directly to the Federal Energy Regulatory Commission (FERC) to seek authorization to begin construction of the project. There some thus some tension between the two cases on whether FERC or the D.C. Circuit is the appropriate forum for a FERC-regulated pipeline project to challenge state agency delay in issuing CWA water quality certification.

No Preemption of State Agency Decisions. The Court rejected the argument that NYDEC’s jurisdiction to review and, in effect, veto FERC’s determinations under the National Environmental Policy Act (NEPA) was preempted by federal law. As the lead agency for conducting NEPA review of Constitution’s proposed project, FERC prepared Draft and Final Environmental Impact Statements (DEIS and FEIS, respectively) concluding that trenchless crossings of many state waterbodies affected by the pipeline were “impractical” and that impacts associated with alternative crossing methods were considered “minimal.” The Court disagreed with the Company’s position that NYDEC’s contrary determination—i.e. that the numerous waterbody crossings in New York would violate state water quality standards—was preempted by FERC’s role under NEPA. In doing so, the Court observed that NEPA imposes procedural requirements for environmental review rather than substantive standards, leaving room for a state agency to impose its own environmental requirements as authorized under relevant law. Further, the Court quoted the NGA “savings” provision, which saves from preemption “the rights of States” under the CWA and a few other statutes. 15 U.S.C. § 717r(d)(2).

State Agency Authority to Consider Route Alternatives. The Court rejected Constitution’s arguments that NYDEC’s multiple demands for information with regard to possible alternative routes for the planned pipeline exceeded the Department’s authority. Constitution had argued that decisions about route alternatives were within FERC’s exclusive jurisdiction and outside of NYDEC’s CWA Section 401 jurisdiction. The court dismissed this argument summarily, however, stating NYDEC’s consideration of alternative routes with potentially less impact on state waterbodies was “plainly” within the state’s authority. Constitution at 23.

Deference to State Agency Certification Decisions. Finally, the Court explained the deferential nature of its review, rejecting Constitution’s claims that the Department’s denial of certification based upon insufficient information about water quality impacts was arbitrary and capricious or an abuse of discretion. Instead of focusing on the three-year-plus dialogue between Constitution and NYDEC, the copious amounts of environmental information supplied by the Company in response to the Department’s requests, and NYDEC’s representation to Constitution in 2015 that it “had everything it needed” to consider the project’s application, the Court instead stated that the Company “persistently refused to provide information” regarding route alternatives or site-by-site information as to the feasibility of trenchless crossing methods for streams less than 30 feet wide. at 26.

Constitution’s related district court case challenging the application of NYDEC water quality-related permitting requirements to the project was also dismissed earlier this year, in March 2017. It remains to be seen what the Company’s next steps will be and how these decisions impact the fate of the proposed Constitution pipeline project.

]]>PHMSA and CSB Urge Special Precautions in the Wake of Hurricane Harveyhttps://www.pipelinelaw.com/2017/08/30/phmsa-csb-urge-special-precautions-wake-hurricane-harvey/
Wed, 30 Aug 2017 20:31:33 +0000https://www.pipelinelaw.com/?p=1788In the aftermath of Hurricane Harvey, the devastating storm that recently swept through central Texas, both the Pipeline and Hazardous Materials Safety Administration (PHMSA) and the U.S. Chemical Safety and Hazard Investigation Board (CSB) are urging special precautions to minimize the impact of the storm on pipeline and other energy infrastructure in the state.… Continue Reading

]]>In the aftermath of Hurricane Harvey, the devastating storm that recently swept through central Texas, both the Pipeline and Hazardous Materials Safety Administration (PHMSA) and the U.S. Chemical Safety and Hazard Investigation Board (CSB) are urging special precautions to minimize the impact of the storm on pipeline and other energy infrastructure in the state.

The CSB issued a Safety Alert on August 27, 2017, urging oil and chemical facility operators to take special precautions when restarting refineries, pipelines, and other facilities in the wake of shutdowns due to the storm. Explaining that “the startup of major processes is a hazardous phase in the operation of oil refineries and chemical plants,” the Alert outlines specific procedures to assure safe restarts and urges operators to implement safety protocols and to ensure adequate staffing and expertise prior to re-start, “recognizing that human performance may be compromised due to crisis conditions.”

PHMSA has advised operators to continue to aggressively implement their hurricane preparedness plans, explaining that contractors are poised to begin post-storm inspections of pipeline infrastructure, including aerial inspections by helicopter, as soon as possible. PHMSA also encourages the use of “Texas Call 811” prior to conducting excavation projects, to minimize the risk of third-party strikes on pipeline infrastructure during repair efforts.

PHMSA also provides information on emergency hazardous materials special permits under 49 C.F.R. §§ 107.105 and 107.117. These provisions apply to the issuance of special permits that allow deviation from PHMSA’s hazardous materials (“hazmat”) regulations applicable to the shipment and transportation of hazardous materials, as well as the processing of applications for such permits on an expedited basis where necessary to prevent significant injury to persons or property or for immediate national security purposes.

While not referenced on PHMSA’s Hurricane Harvey information page, the pipeline safety regulations contain a similar provision, allowing the processing of pipeline special permit applications on an emergency basis where the PHMSA Associate Administrator determines that doing so “is in the public interest, is not inconsistent with pipeline safety, and is necessary to address an actual or impending emergency involving pipeline transportation.” 49 C.F.R. § 190.341(g). These emergency special permits are issued as orders whereby PHMSA waives an operator’s compliance with the requirements of one or more federal pipeline safety regulations for a specified period of time. Id. at § 190.341(a). To qualify for emergency treatment, the event precipitating the special permit application must be “local, regional, or national in scope and includes significant fuel supply disruptions and natural or manmade disasters such as hurricanes, floods, earthquakes, terrorist acts, biological outbreaks, releases of dangerous radiological, chemical, or biological materials, war-related activities, or other similar events.” Id. Emergency special permits may last no more than 60 days and may be renewed upon application to PHMSA only after notice and the opportunity for a hearing on the renewal. Id. More information on how to apply for an emergency special permit is contained in 49 C.F.R. § 190.341.

As it has done on several prior occasions in the aftermath of major hurricanes, PHMSA is likely to issue an advisory to pipeline operators in the coming weeks, reminding them of the regulatory requirements applicable in the aftermath of a natural disaster such as a hurricane. PHMSA has previously explained that hurricanes can adversely affect pipeline operations and can increase the risk of pipelines becoming exposed or constituting a hazard to navigation in the case of underwater pipelines in the Gulf of Mexico. According to PHMSA, such circumstances trigger an operator’s obligation to take appropriate corrective measures. 80 Fed. Reg. 36042, 36043 (June 23, 2015) (citing 49 C.F.R. Parts 192.613 (surveillance of gas pipelines); 195.401(b) (repairs on hazardous liquid pipelines); 192.613, 195.413 (underwater inspections of shallow-water gas and hazardous liquid pipelines)).

]]>D.C. Circuit: FERC to Decide Water Quality Certification Waiver for Natural Gas Pipeline Projectshttps://www.pipelinelaw.com/2017/06/27/d-c-circuit-ferc-decide-water-quality-certification-waiver-natural-gas-pipeline-projects/
Tue, 27 Jun 2017 22:13:36 +0000https://www.pipelinelaw.com/?p=1786As reported in The Nickel Report, the United States Court of Appeals for the D.C. Circuit last week dismissed an interstate natural gas pipeline company’s challenge to the State of New York’s delay in issuing a water quality certification under section 401 of the federal Clean Water Act (CWA). The case is one of several pending across the country that involve a state’s authority to issue, deny, or waive a CWA water quality certification for interstate natural gas pipeline projects.… Continue Reading

]]>As reported in The Nickel Report, the United States Court of Appeals for the D.C. Circuit last week dismissed an interstate natural gas pipeline company’s challenge to the State of New York’s delay in issuing a water quality certification under section 401 of the federal Clean Water Act (CWA). The case is one of several pending across the country that involve a state’s authority to issue, deny, or waive a CWA water quality certification for interstate natural gas pipeline projects.

]]>Federal Court Remands Corps Environmental Analysis for Dakota Access Pipelinehttps://www.pipelinelaw.com/2017/06/22/federal-court-remands-corps-environmental-analysis-dakota-access-pipeline/
Thu, 22 Jun 2017 15:08:35 +0000https://www.pipelinelaw.com/?p=1780Despite oil already flowing through the pipeline, federal litigation involving the controversial Dakota Access Pipeline (DAPL) took another turn last week when partial summary judgment was granted to tribes challenging the adequacy of the US Army Corps of Engineers’ review of DAPL under the National Environmental Policy Act (NEPA) and other statutes. Two tribes, the Standing Rock Sioux Tribe and the Cheyenne River Sioux Tribe, filed suit in July 2016 attempting to block construction of the last remaining segment and operation of DAPL. As sometimes is the case, agency approvals came faster than the court’s opinion, and without a stay of proceedings DAPL began operating in early June 2017. Having granted partial summary judgment, the court did not require pipeline operations to cease, instead delaying the question of an appropriate remedy until after further briefing by the parties.… Continue Reading

]]>Despite oil already flowing through the pipeline, federal litigation involving the controversial Dakota Access Pipeline (DAPL) took another turn last week when partial summary judgment was granted to tribes challenging the adequacy of the US Army Corps of Engineers’ review of DAPL under the National Environmental Policy Act (NEPA) and other statutes. Two tribes, the Standing Rock Sioux Tribe and the Cheyenne River Sioux Tribe, filed suit in July 2016 attempting to block construction of the last remaining segment and operation of DAPL. As sometimes is the case, agency approvals came faster than the court’s opinion, and without a stay of proceedings DAPL began operating in early June 2017. Having granted partial summary judgment, the court did not require pipeline operations to cease, instead delaying the question of an appropriate remedy until after further briefing by the parties.

In a lengthy opinion issued on June 14, 2017, Judge James E. Boasberg of the United States District Court for the District of Columbia noted that the Corps “substantially complied” with NEPA in many areas of its analysis. Nevertheless, the court found deficiencies in the Corps’ consideration of the “highly controversial” effects of the pipeline’s operation: the potential impacts of an oil spill from the pipeline regarding environmental justice and tribal fishing and hunting rights. The court remanded the matter to the Corps for further analysis of these issues, ruling against the tribes on all their other claims. The opinion touches on several significant issues with respect to agencies’ NEPA obligations for pipeline projects generally and oil pipelines in particular, including:

Judicial “Flyspecking” of the NEPA Process. The court reiterated important DC Circuit precedent that its role is to determine the adequacy of an agency’s action using a rule of reason rather than search for any deficiency, no matter how minor. This limited role thus only leads to overturning an agency’s decision if the decision was arbitrary, capricious, or an abuse of discretion.

“Highly Controversial” Effects. The court found that the Corps failed to sufficiently evaluate the degree to which the effects of the proposed action (i.e., the pipeline’s crossing of Lake Oahe, a reservoir created by a Corps dam on the Missouri River) on the quality of the human environment are “likely to be highly controversial”—not measured by newsworthiness or the existence of opposition, but instead by whether a substantial dispute exists regarding the size, nature, or effect of the permit action. The court referenced expert reports submitted to the Corps concerning the likelihood and consequences of an oil spill as evidence of identified “methodological and data flaws” in the environmental assessment (EA) that were “wholly ignore[d]” by the Corps.

Spill Impacts on Tribal Hunting and Fishing Rights. The court also found deficiencies in the Corps’ analysis of project effects, including a potential spill, on tribal members’ treaty rights to water, hunting, and fishing on reservation land because, while the EA discussed the effects of pipeline construction, it said nothing about the effects of a spill on tribal rights once the pipeline became operational.

Environmental Justice. The court considered the propriety of the Corps’ decision to define the geographic unit for its environmental justice (EJ) analysis as a half-mile radius around the Lake Oahe crossing, finding that such a narrowly focused EJ inquiry was insufficient to discharge the Corps’ EJ responsibilities under NEPA. In defending this delineation, the Corps relied on the fact that a half-mile was the buffer typically used for transportation and natural gas pipeline projects. The court rejected this justification as reasonable, however, noting that “DAPL is neither a transportation project nor a natural-gas pipeline; it is a crude-oil pipeline” and that it was thus improper for the Corps to restrict its EJ analysis to such a limited geographical area.

Remedy for NEPA Violations. Turning to the question of remedy for the identified NEPA violations, the court noted that the Administrative Procedures Act requires courts to “hold unlawful and set aside” arbitrary and capricious agency action and, under DC Circuit precedent, the standard remedy for NEPA violations is vacatur. In this case, applying the “standard remedy” would mean vacating DAPL’s permits and easements, forcing it to cease operations until the Corps fully complied with NEPA requirements. The court noted its discretion to depart from the presumptive remedy of vacatur, however, in light of its potentially “serious consequences” and ordered further briefing on whether to do so.

To learn more about Energy and Environmental Law, click here to visit PipelineLaw.com’s sister site.

]]>Volatility of Petroleum Products: Deadline Extended for Submitting Comments on PHMSA ANPRMhttps://www.pipelinelaw.com/2017/03/21/volatility-petroleum-products-deadline-extended-submitting-comments-phmsa-anprm/
Tue, 21 Mar 2017 17:55:39 +0000https://www.pipelinelaw.com/?p=1776PHMSA is extending the deadline for comments due today (March 21, 2017) on the Advance Notice of Proposed Rulemaking (ANPRM) issued on January 18, 2017. The new deadline for comments is May 19, 2017. The ANPRM was issued in response to a petition for rulemaking filed by state of New York, enquiring about risks posed by transport of petroleum by means other than pipeline, specifically by rail, and whether to establish vapor pressure standards for the transportation of crude oil. The ANPRM requested comments on whether a national standard should be developed for vapor pressure of crude oil, including the potential safety benefits and costs of establishing a standard. The intent of the ANPRM is to evaluate measures to reduce risk of fire and explosion in non-pipeline transport of crude oil such as a national vapor pressure standard and, if so, adopt appropriate threshold recommendations for the standard.… Continue Reading

]]>PHMSA is extending the deadline for comments due today (March 21, 2017) on the Advance Notice of Proposed Rulemaking (ANPRM) issued on January 18, 2017. The new deadline for comments is May 19, 2017. The ANPRM was issued in response to a petition for rulemaking filed by state of New York, enquiring about risks posed by transport of petroleum by means other than pipeline, specifically by rail, and whether to establish vapor pressure standards for the transportation of crude oil. The ANPRM requested comments on whether a national standard should be developed for vapor pressure of crude oil, including the potential safety benefits and costs of establishing a standard. The intent of the ANPRM is to evaluate measures to reduce risk of fire and explosion in non-pipeline transport of crude oil such as a national vapor pressure standard and, if so, adopt appropriate threshold recommendations for the standard.

The New York petition proposed a threshold standard of less than 9 psi, without analysis of specific costs and benefits or empirical information to support that limit. In contrast, and as noted in the ANPRM, in late 2014 the North Dakota Industrial Commission implemented a standard vapor pressure threshold of not greater than 13.7 psi or 1 psi less than the vapor pressure of stabilized crude oil. In 2014, the Department of Transportation and the Department of Energy commissioned a review of available crude oil chemical and physical property data to identify properties that could contribute to increased potential for accidental combustion. In conducting this review, the study found that a wide ranging variability of crude sampling types and methods limits the adequacy of available crude oil property data as the basis for establishing effective and affordable safe transport guidelines. This study is part of a four phase plan, which is currently in its second phase, to determine the methods of sampling and analysis that are suitable for characterizing properties of different crude oils.

Due to the technical nature of the ANPRM, the nearly 40 questions posed by the Agency, and the broad implications of the proposal to the supply chain, API and others requested an extension of the comment period. As a result, PHMSA agreed to the comment period an additional 60 days to allow for further information collection and public input.